The construction industry consists of many small businesses employing less than five people. Thus, the challenge is to ensure that these firms keep producing quality housing to match the needs of the customers and clients. In an attempt to improve the quality of housing various policies and mechanisms have been adopted to improve performance and quality. From a detailed study of housing quality and defects this paper discusses knowledge flow within the industry as a whole. It identifies the incidence of defects in various functional elements within a house and suggests the areas where defects are likely to occur. In this way the authors are able to recommend where resources may be directed to the areas where it will be most beneficial both to the house builder and the end user (customer).

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